Hevea Engineers
Hevea Engineers
Industry Information
Will the newspaper business model ever change Created : 22-03-2016

I was at the Press Club. The drinks were taking time to be served. The talk around the table was fragmented. A lot of Saala, Tu Kya Sab Janta Hai? (Hey, you think you know it all?) was in the air.

The Pitch Madison Media report has been out for a while. Print has once again beaten expectations. Everyone in the room has strategies to extend the life of the medium many have written off.

The audience is not worried. They know nothing will happen to print before their term of gainful employment is over. I cannot but help overhearing the conversation on the table next to me. I recognise that hoarse accented tone interrupted by regular clearing of throat. Another voice belongs to a person from a large newspaper group, who had done his round of English and regional print.

There was only one lady in the room.

My friend sitting across me was surprised to see her walk in.   The group was getting high and I know gyaan (knowledge) would soon flood the room. I did not have to wait long. Soon, they were touching every possible theory on print media.  If I was to cover all they said, it will run into pages. So, I am sharing what made sense and some that seemed totally nonsensical- but then who am I to judge.

‘Newspaper pricing, it never made sense to me’. I knew that voice; it was one of the Rare MBAs still In Print Media (RAMBA).  It is a joke, he continued.  Samosa prices have gone from 50 paise to Rs 10 but our paper is still priced low. As if we are inflation proof! The hawker margin keeps increasing with time. External inflation.  It kept decreasing the money that comes to publishers. And this mean a higher dependence on advertising revenue and constrained lower bottomline. Hence, investments went into Readership (real or fake) and copies (sold – this way or that). Meanwhile, our sales targets kept increasing. Everyone wants the growth that Bhaskar and Jagran manage.  Times is also losing’.

It was now the Only Lady In The Hall (OLITH) and I seem to agree to what she said. ‘”The truth. You guys are morons.  You don’t see the reality. It is not as if the reader is unwilling to pay more. In fact the reader has been pleasantly surprised with prices defying every business sense. Prices really are entry barrier for fresh competition. It makes it tough for the new entrant to make money or sustain losses. This also has been proved wrong time and again. No territory is safe.”

‘She is right’ said the Fresh Emotional Voice That I Could Often Lose (FEVICOL) in such a place. The price point has been a barrier for a large media house or a person who wanted to be in media for reason other than journalism. And that could include whole of media in the country. It does not make sense.

RAMBA: Publications should raise their price. I know they will not increase the price. They fear a loss of readers, but the readership has not shown any direct co-relation with the advertising rates. This is the time when collectively all newspapers should collectively move price northward by 25-50 paise a day.  In effect we are talking of some Rs 7-15 increase in one go.  No big shit. Yes the circulation may drop a bit. Trust me, returns will be far higher. And they should do this every six months till they get to at least INR 5 per copy. They may agree to keep the absolute gap between titles at the current position.   This will never happen. Hum Bolta hai tumko! The Old Bengali Babu  (TOBB) was in no more mood to hear. “It will never happen not because a media cartel will be against the business rule but because they cannot trust each other. Ultimately it is about trust.

OLITH: But, if they did so, they could decrease their dependence on advertising, which anyway is going to shrink in future. The column centimetres have increased far more than value. This will be like an anti-ageing formula. Newspapers will get more life.

TOBB: Hobey Na1 This will never happen. You can keep drinking and discussing but this will never happen. Don’t you think they have considered and discussed this?

RAMBA: This makes sense. Is this not so obvious a solution? Wonder, why they have not acted!  The circulation will fall, but it will save losses without affecting advertising rates. In fact 1 paisa per day per copy by the Top 10 can pay for the best of the Readership Surveys.  A new start like BARC!

FEVICOL: The consumer is trained to expect price rise. It is the right time for us to strike. Make the consumer know that free lunch is over. Let him expect frequent price rises. They anyway expect it. That way we will have money to invest in technology and richer content . May be finally the annual conclave in Miami will be a reality. Right now all we hear is Pattaya and Goa.

RAMBA:  And the print will have more legs to be disruptive. A longer life and less pressure.   TOBB: Hobey na. Kichu Hobey Na. I realised that I agree with the Bengali dada more than anyone else. And he added as an after-thought: Sunny Leone video dekha kya?

(OLITH) ‘Disgusting, you guys are disgusting’   I was confused. Was she referring to Sunny Leone or the discussion. Both sounded pornographic to me. May be it was the answer to

TOBB’s Hobey Na. And that had a sound of certainty

Sanjeev Kotnala is Founder of Intradia World. A Brand, Marketing & Management Advisor with 28 years of corporate experience, he focuses on IDEATION (Harvest and Liberate) and INNOVATION (InNoWait) process and workshops. He is also a certified Life & ‘Mid life transition’ coach. Email sanjeev@intradia.in tweet @s_kotnala web: www.intradia.in  www.sanjeevkotnala.com.